By Daniel Hauptman
Originally published in the Loyola of Los Angeles Entertainment Law Review – Volume 30, Issue 2. An unabridged version of this Comment (30 LOY. L.A. ENT. L. REV. 263 (2010)) is available at: http://elr.lls.edu.
Under current Major League Baseball (MLB) rules, if an amateur player is a resident of the United States, Canada, Puerto Rico or other U.S. territory, he can sign with a major league team only after being selected by the team in the annual First-Year Player Draft (or sign with any team after not being selected in a draft in which the player is eligible).1 Entry into the draft is not beneficial to these players, as it restricts their options and potentially limits their compensation. Conversely, international players who are residents of countries other than those listed above (e.g. Dominicans and Venezuelans) are not eligible for the draft and are free to negotiate and sign with any team when they reach the age of sixteen or seventeen years old, depending on the player’s date of birth. As a result of this double standard, MLB is guilty of “reverse” national origin discrimination.
The system needs to be overhauled, and a worldwide draft would level the playing field.
“Reverse” National Origin Discrimination in the Major League Baseball Draft
When applying federal (Title VII) and state employment discrimination laws to the baseball drafting process, it is evident that all draft-eligible players could successfully state a claim of “reverse” national origin discrimination inherent in the annual draft. “A professional sports organization’s relationship with its players and potential players is, at base, an employer’s relationship with its employees and, like other employer-employee relationships, is regulated under state and federal law.”2 All employers with at least fifteen employees are regulated by Title VII,3 and “the law offers no distinction between the half-billion-dollar sports franchise to which millions of fans are devoted and the modest, fifteen-employee, convenience store of which only a few hundred patrons are aware. Both organizations must comply with Title VII.” 4
“Reverse” national origin discrimination against people born in the U.S. is strictly prohibited under Title VII and many state discrimination laws, and this unfair labor practice has been occurring in baseball since the inception of the amateur draft in 1965. Title VII explicitly states that an employer is not allowed to discriminate against any individual with respect to “compensation, terms, conditions, or privileges of employment.”5 Courts have consistently held that disparate treatment is found when “an employer has ‘treated [a] particular person less favorably than others because of’ a protected trait.”6 Baseball’s drafting system results in less favorable treatment on the face of the MLB rules, and this disparate treatment is based on national origin, a “protected trait” targeted by the authors of Title VII of the Civil Rights Act of 1964.7
In addition to disparate-treatment discrimination, amateurs who are forced to enter professional baseball through the draft could also successfully state a claim for disparate-impact discrimination. Statistics detailing the declining percentage of U.S. major leaguers since the advent of the draft in 1965, coupled with the tremendous rise in the percentage of foreign-born players in baseball today, should sufficiently exhibit the disparate impact on draft-eligible players. Also, evidence confirming the contention of baseball super-agent Scott Boras, that the current drafting system suppresses the incomes of U.S. players to “20 cents on the dollar,”8 would effectively prove that U.S. players are significantly devalued as a result of this disparate impact. Furthermore, an examination of the plight of Puerto Rican baseball since MLB added players from Puerto Rico and other U.S. territories to the draft pool in 1989 would certainly display the devastating impact that inclusion in the MLB draft has had on the game of baseball on the island.
National Labor Law Would Not Preempt an Employment Discrimination Claim
A successful claim of national origin discrimination would have to overcome potential preemption by section 301 of the Labor Management Relations Act (LMRA) of 1947. Current and future players are governed by the rules established in baseball’s collective bargaining agreement (CBA), and the LMRA (and National Labor Relations Act) encourages the formation of collective bargaining agreements in sports and other industries. Section 301(a) addresses the jurisdictional aspect of suits by and against labor organizations,9 and it is aimed at preventing inconsistent state laws from effectively nullifying the terms agreed upon during the collective bargaining process. It is important to note that section 301 only applies to state-law claims, not federal claims (e.g. a Title VII employment discrimination claim).
As established by the U.S. Supreme Court, section 301 of the LMRA preempts a state-law claim “only if such application requires the interpretation of a collective-bargaining agreement.”10 Accordingly, a federal court would only preempt a state-law discrimination claim where the CBA specifically prohibits national origin discrimination. That is not the case in the CBA between MLB and the Major League Baseball Players Association (MLBPA). MLB’s drafting system inherently applies differently to players from varying countries of national origin, and there does not appear to be a right of action in the CBA upon which a state-law discrimination claim would be based. Furthermore, because baseball’s CBA does not address a current or prospective player’s right to bring a discrimination claim, there is no interpretation of the CBA that needs to be analyzed by a court. When applying a narrow approach to section 301 preemption—as favored by the Eighth Circuit in two recent cases11 —a potential state-law claim would not be preempted.
Major League Baseball Needs to Expand to a Worldwide Draft
While MLB has struggled with the unequal and unfair consequences of its regionalized draft, the National Basketball Association and the National Hockey League have conducted global drafts for many years. In those sports, the same draft-eligibility requirements apply to all prospects from all nations. Baseball has discussed expanding to a worldwide draft since the 1980s,12 but change has not happened, and the trend of teams spending more and more money cultivating prospects in Latin American countries—instead of in the U.S., Canada and Puerto Rico—continues.13
Nearly a decade ago, MLB and the MLBPA actually agreed to the concept of a worldwide draft during CBA negotiations for the labor deal of August 2002. Attachment 24 to the 2003–2006 CBA is a memorandum that was signed by officials from both parties, and it states “that the First-Year Player Draft should be expanded to cover all players who are first entering Major League or Minor League baseball, regardless of a player’s residence.”14 Both sides agreed that “[n]o later than October 15, 2002” a worldwide draft subcommittee would begin deliberations to “consider all issues relating to the acquisition of players through a worldwide draft system.”15 Although MLB officials believed that a global draft would be implemented by 2004 at the latest, the subcommittee scarcely met and in the subsequent—and current—CBA that expires in December 2011, there is no indication of any intention to alter the draft-eligibility rules.16
In recent years, there has been renewed discussion of expanding the draft pool, and leaders from both sides have been quoted expressing support for a worldwide draft.17 While those statements are encouraging, there have been forty-five years of baseball entry drafts in which U.S. amateurs (and Canadians and Puerto Ricans) have been treated worse than foreign players, and there would be no need for potential discrimination litigation if MLB were to finally institute a draft with uniform rules around the world.
Daniel Hauptman is a third-year student at Loyola Law School in Los Angeles. He has worked in various aspects of the sports industry since beginning his career at CBS Sports at 16 years old. Daniel graduated from the University of North Carolina at Chapel Hill and received a Master of Science in Sports Business degree from New York University. If you would like to contact him, email: dan.hauptman@gmail.com.
1 See MAJOR LEAGUE BASEBALL OFFICE OF THE COMMISSIONER, FIRST-YEAR PLAYER DRAFT OFFICIAL RULES 4 (2009), available at http://mlb.mlb.com/mlb/draftday/rules.jsp.
2 N. Jeremi Duru, Fielding a Team for the Fans: The Societal Consequences and Title VII Implications of Race-Considered Roster Construction in Professional Sport, 84 WASH. U. L.R. 375, 376–77 (2006).
3 See 42 U.S.C. § 2000e-(b).
4 Id. at 377.
5 42 U.S.C. § 2000e-2(a).
6 Ricci v. DeStefano, Nos. 07-1428 and 08-328, slip op. at 17 (U.S. June 29, 2009), http://www.supremecourtus.gov/opinions/08pdf/07-1428.pdf (quoting Watson v. Fort Worth Bank & Trust, 487 U.S. 977, 985–86 (1988)).
7 See 42 U.S.C. § 2000e-2(a).
8 Dave Sheinin, Boras May Explore Japan for Strasburg, WASH. POST, July 3, 2009, at D1.
9 See 29 U.S.C. § 185(a).
10 Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S. 399, 413 (1988).
11 See Bogan v. Gen. Motors Corp., 500 F.3d 828 (8th Cir. 2007); see also Williams v. Nat’l Football League, 582 F.3d 863 (8th Cir. 2009).
12 See Alan Schwarz, Pressure Building for Draft of Players from Outside U.S., N.Y. TIMES, July 13, 2008, at SP4.
13 See Kevin Baxter, The Shortcuts: Deeply Entwined MLB Investigates Steroid Use, Document Fraud and Skimming as Dominican Prospects Seek Rich U.S. Contracts, L.A. TIMES, Sept. 22, 2009, at C5.
14 2003–2006 Basic Agreement Between the Major League Clubs and the Major League Baseball Players Association, Attachment 24, 202–04 (effective Sept. 30, 2002), http://www2.bc.edu/~yen/Sports/mlbpa_cba.pdf.
15 Id.
16 See Alan Schwarz, Pressure Building for Draft of Players from Outside U.S., N.Y. TIMES, July 13, 2008, at SP4.
17 See Podcast: Interview by Mike Francesa with Michael Weiner, Executive Director, MLBPA, on WFAN Radio (Dec. 2, 2009), http://podcast.wfan.com/wfan/2089981.mp3 (expressing the players’ support of a global draft 8:00 into recording); see also Bill Shaikin, Baseball Players Suggest Changes, L.A. TIMES, Dec. 3, 2009, at C3 (stating that “owners would like to control spending on amateur players by subjecting international players to the draft”).
